China’s economic expansion is rapidly filling spaces vacated and ignored by the United States. In the Western Hemisphere, the lack of a coherent U.S. foreign policy has left the door wide open for a variety of actors. China hasn’t hesitated.
While the U.S. waited five years to pass free-trade agreements with Colombia and Panama, China has been working with Colombia on developing a coast-to-coast railroad as an alternative to the Panama Canal. While the U.S. spends four years dithering over the Keystone XL pipeline, a slam-dunk energy project with another hemispheric ally—Canada— China has made preparations to buy Canadian oil through new pipelines and invested heavily in national oil companies in Brazil and Venezuela. China has invested in Peru’s mining, oil, wood, fishing, and tourism sectors. Chinese groups have signed agreements in Brazil and Argentina to develop millions of acres of farmland to boost its food security. China’s trade with Latin America has grown by double digits annually since 2006, while U.S. direct investment has dropped. China is an economic and political threat and has made significant gains—but it is not too late. The Barack Obama administration’s lack of leadership with regard to Latin America doesn’t mean the U.S. must resign itself to a Chinese-centric hemisphere. Despite its economic might and influence, China doesn’t enjoy the cultural and logistical connections with Latin America that the U.S. takes for granted. The peoples of our two regions share values like freedom of speech, democracy and the hope for a safe and secure environment in which our children can prosper.
Connections like these, with neighbors near our borders, should give the U.S. an unbeatable advantage. It’s time the Obama team puts forth a foreign policy that takes Latin America seriously or steps aside before it’s too late.
Don Hanna Answers:
China’s emergence as a global economic force, surpassing in many ways the political influence the country wielded in the 1950s and 1960s, is a development with profound and multifaceted implications for the Western Hemisphere—implications that aren’t sensibly encapsulated in terms like “threat” or “opportunity.” The important issue for the people of the Western Hemisphere is to understand the nature of those implications and to respond in a fashion that magnifies the gains for the region from China’s astonishing emergence. Demonizing (or sanctifying) China is not a sensible response.
One crucial aspect to understand about China’s emergence is that it is not an emergence, but a reemergence. Prior to Europe’s industrial revolution, global income was distributed largely on the basis of population because technology—and hence labor productivity—didn’t differ much.
China’s reemergence, then, owes much to its ability to put in place policies that have allowed it to catch up with frontiers of technology and improved productivity. Learning which elements of China’s success can be replicated should be a welcome spur to development in the Western Hemisphere.
Another crucial aspect of China is its sheer size—with all the demands that creates on resources and the environment. Higher terms of trade for commodities—a boon to the region’s commodity producers—owe much to the surge in China’s economy. At the same time, China’s surging greenhouse gas emissions, among the highest in the world, highlight the urgency of a coherent, global program to control such emissions. China’s sheer size, though, makes it more likely that the country will realize that its own actions will matter in solving this global problem.
The Western Hemisphere needs to contribute to the fashioning of global institutions that can accommodate China’s reemergence, providing an opportunity for China to share in the burdens of global macroeconomic, political and environmental stability that come with its resurgence.
Luis Fleschman Answers:
President Barack Obama forged a new policy of reengagement with Asia on his recent trip to the region—sending a clear message that the U.S. intends to check China’s geostrategic ambitions if they threaten neighbors.
While the Chinese government resents the U.S. presence in what it considers its neighborhood, it is dramatically increasing influence in ours. In 2008, the Chinese government issued a white paper on Latin America outlining its objectives of strengthening economic, political and military ties in the region.
In the past decade China has increased its investment in Latin America by 400 percent. This includes massive purchases of raw materials and commodities, free trade as well as technological and space cooperation. China has been a major force fueling the economic prosperity in much of Latin America and has effectively replaced the U.S. as Brazil’s main trading partner.
This economic omnipresence provides China not only with profits but also with considerable political influence. We know from government publications and actions that the Chinese believe their economic power must be backed by military as well as strategic engagement with key partners. As a result, China has a 50-year lease that gives them control over both ends of the Panama Canal, and has established a presence in a number of strategic sites throughout the continent, including the Bahamas, Cuba and Ecuador.
China has also strengthened ties with Venezuelan President Hugo Chávez and his regional allies in the Alianza Bolivariana para los Pueblos de Nuestra América—Tratado de Comercio de los Pueblos (ALBA), Ecuador, Bolivia and Nicaragua. These countries are openly hostile to the U.S. and seek to weaken its influence in the region. As a result, the ALBA countries have dismantled key U.S. military bases and have invited China in.
China’s policy of politically protecting anti-American rogue states like Iran, Sudan, Syria, and North Korea leads to the conclusion that China also supports the Bolivarian revolution. This could be ominous. Countries of the Bolivarian alliance have taken dangerous steps, such as undermining democracy, as well as strengthening relations with the Revolutionary Armed Forces of Colombia (FARC), the drug cartels and Iran.
As China continues to help perpetuate the ALBA regimes, regional as well as U.S. national security could be seriously challenged. It’s time for the U.S. to reengage in Latin America as it recently did in Asia.
Minxin Pei Answers:
With China’s growing economic presence in the Western Hemisphere, it is inevitable that a question like this will arise. The answer, fortunately, is an emphatic “no.” To think otherwise is to see international commerce as a zero-sum game and exaggerate China’s capabilities.
In terms of China’s growing economic clout in Latin America, it hardly constitutes a threat to U.S. interests, which are both deep and extensive in the region. Chinese economic activities, concentrated mostly in imports of commodities and exports of consumer goods (with modest investments in natural resources and infrastructure), do not compete directly against U.S. firms, which specialize in other sectors (services, hi-tech, automotive, and banking).
In the political realm, Chinese influence is modest at best and cannot compete effectively with the United States. China’s political regime, a one-party dictatorship, hardly appeals to the region, where democratization since the early 1980s has discredited authoritarian rule.
China has also cautiously avoided encroaching upon U.S. security interests or needlessly antagonizing the U.S. by befriending Cuba and Venezuela—the two countries disliked most by the United States. Based on Chinese national interests, Beijing has no incentive to compete against the U.S. in the Western Hemisphere. Such competition would be costly and have meager geopolitical benefits. It will divert precious resources from China’s efforts to defend its interests closer to home—in East Asia.
However, for the countries in the Western Hemisphere, China’s growing presence should provide, on balance, a net benefit since these countries can use the Chinese presence to seek a better bargain with the United States. For the U.S., the days when it could exercise unchallenged influence over the Western Hemisphere are numbered. But that is not a bad thing. Most probably it is good for the U.S. itself.